14 Apr Claiming your FitOut Expenses at EOFY
Did you know you can claim nearly ALL of your fitout expenses at End Of Financial Year?
Whether you’re a Commercial property owner or a tenant, you can reduce the costs of a fit-out by claiming property depreciation, once your lease starts. Which could make a huge difference if you’re considering the costs involved when planning your fitout.
When planning, there are a few very simple rules which must be considered:
- Commercial tenants are able to claim depreciation for any fit-out they add once their lease starts.
- At the same time, commercial property owners can claim deductions for any of the plant and equipment items originally found in the property.
- If a tenant’s lease demands that the property must be returned to its original condition, the tenant can scrap and write off the remaining depreciable value of removed assets in the financial year of their removal.
- If a tenant vacates a building and does not remove the fit-out, the owner may still be able to claim the remaining depreciation for these items.
So there’s the rules. But let’s make things a bit simpler for you by looking at a real scenario:
Jenny established an administration business in July 2014. She rented out an office building and on commencement of the lease she installed a number of office assets in a fit-out which cost a total of $90,560.
On visiting her accountant, she became aware of her eligibility to claim depreciation for any fit-out installed within her business.
The list of the assets installed during the fit-out were: new carpets, computers, an enveloping machine, office chairs, a photocopier, workstations, blinds and a complete telephone system including a switchboard. The accountant calculated their depreciated value, at the end of the first year. Which in this case came to a total of almost $30K. All of which can be claimed when doing a tax return at the End of Financial Year.
In summary, here are some examples of fitout expenses you can claim:
- Office Furniture
- New Carpet
- New Blinds
- Office Equipment such as Computers,
- Relocation Expenses
- Professional Fees e.g. Designers and Project Managers
- Engineering Services
If you’re interested in understanding more about this, our friends at The Insight Company would be glad to assist.
Or, if you’re interested in getting your FitOut underway, contact our friendly, highly experienced team at FitsIn. We’ll guide you through every step of the way!